I am a senior editor at Forbes, covering legal affairs, corporate finance, macroeconomics and the occasional sailing story. I was the Southwest Bureau manager for Forbes in Houston from 1999 to 2003, when I returned home to Connecticut for a Knight fellowship at Yale Law School. Before that I worked for Bloomberg Business News in Houston and the late, great Dallas Times Herald and Houston Post. While I am a Chartered Financial Analyst and have a year of law school under my belt, most of what I know about financial journalism, I learned in Texas.

Strife-Torn Yemen Tops The World's Worst Economies

Twice within a month this spring, militants knocked out the pipeline leading to a $4.5 billion liquefied natural gas plant built by France’s Total in Yemen. Weeks later Total was still negotiating with local tribes to get its crews in to repair the pipeline and restart the 6.7 million-ton per year LNG plant, a key component in Yemen’s efforts to supply more energy to its citizens and diversify its economy away from crude oil.

Total needed to obtain signed agreements “with more than a dozen sub-tribes and splinter groups” before it could attempt repairs, an industry source told the International Oil Daily.

Such is life in Yemen today, as the oil-rich nation struggles with rebellious tribes, a resilient al Qaeda franchise, and U.S. drones in the air that inspire bloody acts of retaliation on the ground. The turmoil has cost Yemen more than a quarter of its oil production and helped place it atop this year’s list of The World’s Worst Economies.

Second on the list is Syria, a similarly strife-torn Arab nation whose economy shrank by at least 6% last year as dictator Bashar al-Assad drew stiff international sanctions over his bloody military attacks on his own citizens. Third is Sudan, a perennial contender for Worst Economy honors. New to the list this year is Pakistan, whose economy has suffered from a poisonous combination of stagnant per-capita income and high inflation.

To construct the list, we pulled a broad range of economic statistics from the International Monetary Fund, supplementing with other sources including the CIA World Factbook, the U.S. State Department and various development organizations. This list is not exhaustive; North Korea is clearly the world’s worst economy but with no reliable statistics we can’t compare it with the rest of the world.

We used three-year averages for per-capita income and GDP, to smooth out temporary changes. Countries with low per-capita incomes, growing populations and high inflation do the worst by this measure, and thus Africa tends to contribute more than its share of weak economies. A country’s natural wealth has little to do with whether it will land on the World’s Worst Economies list; resource-rich countries like Yemen and Chad make it solely because of their own mismanagement.

With per-capita income of $1,418 and an estimated adult illiteracy rate of 45%, Yemen ranks among the poorest countries on earth. This despite the fact that Yemen has 3 billion barrels of oil, providing about a quarter of the country’s $63 billion GDP and 70% of government revenues. Attacks by al Qaeda and militant tribes helped trim oil production by 125,000 barrels a day last year amid widespread violence that also led to the resignation of longtime leader Ali Abdullah Saleh.

“In a sense, what Yemen has gone through is a perfect storm,” said Barbara Bodine, a professor at Princeton University’s Woodrow Wilson School of International Affairs and U.S. ambassador to Yemen from 1997 to 2001. “Political turmoil has been devastating to Yemen, as it was for Egypt and Libya, but you’re talking about a country that was bouncing along the bottom already.”

Post Your Comment

Post Your Reply

Forbes writers have the ability to call out member comments they find particularly interesting. Called-out comments are highlighted across the Forbes network. You'll be notified if your comment is called out.